3 Talent Retention Techniques that Really Work

The way a company hires, integrates, manages and rewards its employees is key to its success. These aspects are too important to simply leave to chance, which is why successful companies use facts and data to ensure excellence and why we’d like to share three simple, scientifically proven ways for companies to retain talent.

Why is Talent Retention so important?

Retention is essential because it reduces company costs associated with staff turnover (the recruitment and training of new employees). Retaining experienced employees ensures greater job continuity and efficiency, as well as preserving valuable knowledge and skills within the company.

High talent retention rates also contribute to a more stable and motivating work environment. Employees who feel valued and see opportunities for growth are more likely to stay with the company, which improves productivity and overall satisfaction, while also strengthening employer branding.

Do you want to know how much turnover costs your company?

Calculate

The true cost of high turnover rates

In addition to the negative impact high employee turnover has on a company’s image and employer branding, it also creates instability in the work environment, which often leads to  serious consequences for team productivity. 

A significant problem associated with a higher than average turnover rate is the financial cost. The loss of talented employees not only affects the continuity of projects, but also entails considerable expenses in terms of recruitment, training and the onboarding of new employees, costs which HR has to deal with. 

The hard data shows that replacing an employee can cost anywhere from 50% to 200% of the employee’s annual salary, as per Gallup. Meanwhile, the job website Monster reports that according to its own research, its data puts the figure as high as 75% to 200% of the employee’s annual salary. 

Technical roles tend to be even more expensive, averaging between 100% and 150% of an employee’s salary, according to HR services provider G&A Partners. Meanwhile, according to the professional association, SHRM., C-level positions can cost up to 213% of a salary.In another study, Japanese tech company Ricoh conducted research among a sample of 1,000 workers and 250 decision-makers in Spain, and the results they published indicate that the average cost of replacing just one employee in Spain is €7,400.

How does employee turnover impact your business?

In order to address this situation effectively, it is essential to have a clear understanding of how turnover impacts your finances. We recommend using our ROI calculator, a tool that will allow you to accurately measure the financial impact of employee turnover on your organisation. By entering cost-specific data associated with turnover, you can gain detailed insights  that will help you make informed and strategic decisions to improve talent retention and ultimately optimise your resources.

Staff turnover statistics in Spain

As we mentioned earlier, every industry and every country has its own characteristics, which is why turnover rates vary widely. According to a Randstad 2022 study, private sector configuration and talent retention in Spain is as follows:

Industries with the highest turnover rates

Industries with the lowest turnover rates

Turnover rate: when you should be concerned

A high turnover rate means that a significant number of your employees (more than expected in your industry) have left your company within a given period of time. Expected turnover rates vary depending on the industry and the country concerned. Therefore what is considered to be a high turnover rate will vary accordingly.

If your figure is significantly above average, you are likely to face a high turnover problem. Given that the overall average in Spain is 17% according to the above-mentioned Randstad report, if 18% or more of your new employees leave within their first 90 days, it is important to investigate the underlying causes and address them immediately.

Three tried-and-tested strategies to avoid high turnover

While you can access thousands of articles on the web and there is plenty of advice available from professionals, the truth is that when it comes to talent retention, three simple strategies exist which, when implemented correctly, will suffice. These first emerged from a scientific study published by Walden University in 2020 and are as follows:

• Invest in Employee Training: Employee training is essential for developing skills and improving behaviours and actions in the workplace. Training should include one-on-one meetings for every employee, in which the department leader shares their thoughts on their performance.
• Engage Employees: This strategy is effective in increasing organisational productivity, reducing absenteeism, building employee loyalty, improving customer satisfaction and increasing retention rates. Employee engagement fosters creativity and collaboration, leading to an increase in employee motivation, sense of autonomy and desire to become more involved in their jobs.
• Build Positive Employee Relationships: Building positive relationships means that every manager respects and treats employees fairly, gets to know them better and ensures an equitable workload. Benefits include  improving mood, driving productivity, lifting morale and promoting personal development. To build these strong, positive relationships, management must connect with employees, listen to their concerns, encourage them to share their opinions and promote family involvement.

Effective management of employee recruitment, staff onboarding and talent retention is essential to the success of any business. Using data to understand and improve turnover helps reduce costs and improve productivity. Implementing proven strategies, such as ongoing training, active engagement and positive relationship building, can increase job stability and satisfaction, thereby strengthening overall organisational performance.